Improve efficiency in the Last Mile: How Modern Logistics is Transforming E-Commerce
The last mile is the critical stage of any delivery journey — and in online retail, it often defines customer experience and brand loyalty. With rising parcel volumes, labour shortages and tight delivery windows, GCC retailers and logistics providers must adopt smarter, more efficient and more sustainable delivery strategies.
What does “last mile logistics” mean?
The “last mile” describes the final stage of a parcel’s journey — typically from a depot, micro-hub or regional fulfilment centre to the end customer. This phase is complex and cost-intensive, influenced by traffic, narrow delivery windows, failed delivery attempts and the increasing need for greener transport options.
UAE consumers expect convenience, speed, and full visibility as standard. Home delivery remains the preferred choice, while more customers are opting for timed slots, real-time tracking, and ultra-fast options such as same-day or next-day delivery. In the GCC’s B2C sector, high-rise residential towers, gated communities, and smaller order sizes contribute to higher per-parcel costs and demand highly adaptable and efficient delivery networks.
To remain competitive, e-commerce operators are investing in optimised warehouse design, live pallet racking, automation and smarter route planning — ensuring orders can be fulfilled quickly and reliably.
What is the role of Supply Chain Management in last-mile success?
Robust supply chain management (SCM) is vital to coordinating stock, delivery capacity and fulfilment speed. Digital SCM tools enable retailers and 3PLs to:
- Plan inventory and stock replenishment accurately
- Reduce safety stocks and warehouse holding costs
- Increase delivery reliability for committed time windows
Digitalisation and automation are essential drivers, including automated pallet racking systems, real-time data platforms and AI-driven forecasting tools. For many businesses, intralogistics upgrades such as roller shelving, rack trolleys, bin trolleys and warehouse planning aligned to racking dimensions deliver efficiency benefits from storage to dispatch.
What elements affect the last mile in logistics?
Parcel lockers, click & collect and smart delivery points
To cut transport costs and emissions, retailers and couriers are expanding delivery options beyond traditional home drop-offs:
- Parcel lockers and pick-up points at supermarkets, rail stations and petrol forecourts
- Neighbour collection networks and micro-depots
- Click & Collect and Click & Drive fulfilment from high-street stores
These approaches consolidate deliveries, reduce repeat attempts and shorten delivery routes — supporting more sustainable logistics efficiency and reducing pressure on drivers.
For customer convenience, secure home parcel boxes and smart boxes are also growing in popularity, alongside return kiosks and local collecting trolleys for convenience-led neighbourhood deliveries.
Autonomous delivery & alternative transport
Innovation is rapidly advancing across the GCC, with the UAE leading regional adoption. Delivery drones are undergoing government-approved testing, while autonomous ground vehicles and robot couriers are being trialled within smart city districts such as Dubai Silicon Oasis and Masdar City. In dense urban areas, e-scooters, e-carts and e-cargo bikes are increasingly used to enhance delivery speed, reduce congestion, and support national sustainability goals.
These solutions complement urban consolidation centres and micro-hubs, cutting congestion and emissions in city centres.
Digital and AI-enabled last-mile optimisation
The last mile can represent up to half of overall logistics costs — making optimisation essential. Technologies shaping modern delivery include:
- AI-enabled route optimisation and predictive planning
- Real-time traffic and CO₂-optimised routing
- Smart order batching for high-density urban zones
- Dynamic vehicle loading strategies
Within warehouses, AI and automation also support rapid order picking, using technology such as roller track systems, automated pallet storage and sensor-based conveyor systems.
Retailers integrating warehouse automation, sustainable delivery modes and digital supply chain control are gaining advantage — ensuring flexibility during peak volumes and enabling consistent service levels.
What is the future of the last mile?
The rapid growth of e-commerce has intensified the pressure on fulfilment operations, warehouse automation and intralogistics infrastructure.
Modern last-mile operations rely on more than delivery technology alone. They require aligned warehouse processes — from picking efficiency to outbound loading. Solutions from BITO such as pallet live storage, automated pallet racking, Carton live storage and automated small parts storage help businesses build scalable and safe intralogistics environments.
The most successful GCC/UAE operators will be those who:
- Invest in automated, scalable, and climate-resilient warehouse infrastructure to handle rapid e-commerce growth.
- Deploy AI-enabled route optimisation and smart delivery planning that can adapt to high-density towers, gated communities, and complex road networks.
- Expand parcel locker, smart collection-point and micro-hub networks across residential towers, malls, and community centres.
- Expand parcel locker, smart collection-point and micro-hub networks across residential towers, malls, and community centres.
With customer expectations rising and sustainability targets tightening, the last mile is no longer just a delivery challenge — it is a competitive differentiator.